The Balanced Spreadsheet-Financial News, Budget Advice, Debt help, Financial Tips, and other advice

December 18, 2009

79.9% Credit Card? Who would use that?

Filed under: News Review, Personal Finance — Tags: , , , , , — thebalancedspreadsheet @ 2:56 pm

I came across this article from the AP this morning while browsing the web titled Credit card’s newest trick: 79.9 percent interest.  It is about First Premier Bank and how it is marketing the expensive credit card at 79.9% APR.  It is marketed toward subprime customers who can not get a traditional credit card.

There are some interesting quotes and figures in the article.  The cards credit limit is only $250-$300 but the annual fees are currently $256 in the first year!  Although starting in Feb 2010 the fees will drop to $75 in compliance with the new credit card regulations.  With all that being said this quote really got me:

“Even when the cost of credit is astronomical, for people in true emergencies, it’s much better than not having access to credit,” said Odysseas Papadimitriou, CEO of CardHub.com.

If you have read this blog for any length of time, you know that I am pretty much anti-credit card.  With that being said, I can not believe that quote.  They would be better off to continually get ripped off with high fees and interest rates then to not have access to credit?  Well how much of a blessing has their credit been so far?  It has lead to defaults and higher interest rates!  Unbelievable!  People who have shown the inability to handle credit should not be extended more!  To me this is just another example of the poor being taken advantage of, similar to pay day loans.  Now granted the people who sign up for this card did have a choice before filling out the application and they should be held responsible for their debt, but to me you have to have some kind of moral responsibility as a business to not market this stuff.  Sadly the reason they do market this junk is because people use it and it is profitable.  I think we just need to educate more on how bad of a product this is and how it is not beneficial to consumers in the long run.

Well there’s my soap box.  Anybody else have any thoughts on this?

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2 Comments »

  1. […] The Balanced Spreadsheet sheds light on an 80% APR credit card! […]

    Pingback by Friday Fiscals: Snowy Saturday edition | Mighty Bargain Hunter — December 19, 2009 @ 1:56 pm

  2. Wow. The nerve. Malarkey, I say!

    Comment by Dogfood Provider — December 20, 2009 @ 12:05 pm


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